Congress Critters are doing it
again! When 9-11 traumatized the American psyche, we were given an
Official Conspiracy Theory to ‘splain it to us. Something about Arabs and
a spooky guy named Osama…. But he’s not even on the FBI Most Wanted List
for 9-11. Our Decider told us a few years back that he was no longer
interested in finding Osama. Besides, ole Osama kicked the bucket in
December 2001 according to an Egyptian news report.
To obtain some sense of security,
many Americans welcomed the USA PATRIOT Act. We let the Congress Critters
eviscerate what America was all about—our Constitution and Bill of Rights.
Gutted and hung! Our Congress Critters got flimflammed into believing
that Iraq had Weapons of MASS Destruction that could blow up in our faces
at any moment! We were told that our “sources” knew the address and zip
code. They’ve given up looking but over a million Iraqis have died along
with over 4,000 American men and women. Our lifeblood was drained to pay
for a War against Terror!
In the past few weeks we’ve been
hearing that the poor ole banks are falling on hard times. They seemed to
have been doing pretty well. They had been getting poor folk to sign up
for special mortgages when they didn’t qualify for the usual kind. Five
years ago I was warning about the predatory lending practices of the
mortgage brokers and the banks, and I was showing people how to use the
consumer protection statutes. There was an average of about 20 violations
of the Truth in Lending Act in every mortgage that we analyzed The Feds
didn’t like that information made available on the Internet so the Office
of the Comptroller of the Currency alleged that my website was
perpetrating a mortgage elimination scam. Eliot Spitzer wrote in the
Washington Post that the 50 state governors and attorneys general were
trying to stop predatory lending, too, but the Feds forced them to stop.
They never tried to get me to stop, but a lot of people probably thought
the government was right. Intimidation by the Feds worked again.
Back in 1999 Congress Critters
voted 450-64 to remove the Glass-Steagall prohibition against banks
speculating in high risk securities. Clinton was all for it, too. So the
banks took these rip-off mortgages, called them “subprime”, bundled them
together and sold them on the derivatives market….and then kept selling
them, rebundling them, selling them around the world, making a profit at
every turn. Until only a few weeks ago, we were being told that we were
not in a depression or even a recession. Then some of those funny
mortgages started to fail and things started to get very interesting.
Suddenly the leaders started talking nervously about a bailout or the sky
might fall. Those bankers are demanding socialized medicine for their sick
institutions. They spent a lot of money to get the legislation passed so
they could play in this sand box and when they’ve run out of sand they
want mommy and daddy to fill it for them again.
There’s more to this “financial
emergency” than subprime mortgages and escalating risk in the derivatives
market. The watchdogs of these big brats have been very lenient and
indulgent over the years. Naked short selling played a big part in the
cause of the last Great Depression. Naked short selling is a bet that the
stock will diminish in value, but unlike short selling the naked short
seller doesn’t deliver the stock that was promised when the short sale was
transacted. It’s an incomplete transaction, a breach of contract. The
result is a “phantom stock” not too different from counterfeit money and
with much the same result. According to
some investigators it could cost over one trillion dollars to clean up the
phantom stocks that are in the system.
Even though the SEC has admitted
that phantom stock can collapse the financial system, it has not moved to
stop the sale of phantom stock and naked short selling. They have only
placed affected stocks on a list so that investors can see who is being
victimized….and the stock falls faster and farther. A large portion of the
stock in these 300 companies is bogus. It might show up on a computer that
you own it, but you really don’t. On September 17, the SEC declared that
it was serious about enforcing its regulations, but they have been
warned and informed about the practice for years and no investigations
were pursued.
More than $1.5 quadrillion in
stock trades is processed every year through the Depository Trust and
Clearing Corporation (DTCC), headquartered in New York City, .A very
difficult organization to investigate, the DTCC is owned by its users and
it’s not transparent to the SEC. Every short sale is processed through it
and therefore the DTCC would know which brokers have hedging clients
selling stock but not delivering. The government knows where
the counterfeiters work but never bothers to stop them.
You probably have not heard much
of naked short selling or phantom stocks because influential people in the
media have been pooh-poohing the complaints of CEOs and investors alike.
The money gurus are part of the problem. It’s a very sophisticated sting:
first the target company gets glowing publicity from one or more money
gurus in the media. A corrupt law firm tells its clients to purchase some
of the stock so that they can later be named as plaintiffs in a
class-action suit against the company. A corrupt hedge fund takes a short
position on the stock by borrowing from an investor who holds the stock,
then sells the stock and waits for its inevitable fall in price.
Fraudulent “research” that alleges problems within the company is revealed
on one or more of the mainstream money shows. For weeks the money gurus
allege wrongdoing at the company as the value of the stock drops. The SEC
places the company on the list of companies affected by phantom stock,
driving the value of the stock still lower. The SEC might even begin an
investigation of the company with even greater effect. The shyster lawyer
files suit against the company for defrauding his clients and the stock
continues to plummet. A stock position opens on foreign exchanges against
the wishes of the company because this makes it even easier to flood the
market with phantom stock. The short sale is repaid with phantom stock
diluting the value of the company’s real stock. If the company can be
driven out of business, that is the most lucrative outcome for the naked
short sale. It’s devastating to the investors, employees, related
businesses and to the economy as a whole.
So now our Congress Critters are
trying to scam you and me by telling us that these shenanigans must be
taken upon OUR shoulders. If they don’t investigate and prosecute the
perpetrators, the criminals will be coming back for more….and more….
You best let them know how you
feel about that. Right away.
In accordance with Title 17
U.S.C. Section 107, this material is distributed without profit to those who
have expressed a prior interest in receiving the included information for
research and educational purposes.
See the details at
History of Banking Fraud:
The Coming Battle
By M. W. WALBERT
